'2126' pid='77212' datel Wrote:Taking the IOC PR at face value, here is what has happened:
Today, the Canadian Appellate Court overturned the decision by the Yukon Supreme Court that ruled that the IOC/Exxon deal was 'fair and reasonable.' Thus, that deal is dead as it will not get a Final Order of Approval by the Yukon Court. Without reading the Appellate decision yet [I've been unable to find it online and it may not be published for a while yet], my best guess is that the Appellate Court found that the lack of a valid Fairness Opinion for IOC from an independent source failed to provide the IOC shareholders with sufficient information to make an informed vote on the Exxon Arrangement.
If that is the basis for the decision, Exxon and IOC could come back with the same deal, but obtain an independent fairness opinion from an independent source that is paid a flat-rate fee for such opinion. However, such a fairness opinion would have to be much much more detailed that the faux MS opinion. It would have to, at a minimum, look at the prior resource evaluations of E/A, the value of the Total contract [including the 30% ownership of the plant], the value of Triceratops, Raptor, etc. including their resource estimates, the value of the additional IOC acreage, the value of the IOC leases, the value of the IOC seismic and graviometry, etc. etc. etc.
Once that information is made public and provided in detail, it would be very difficult for Exxon to simply provide their same offer, particularly with the 10 tcfe cap on the contingent payments.
Finally, this may open the door for additional bids from other companies. That question, however, is far from answered by this brief press release. If the Appellate Court has ruled that the deal is not 'fair and reasonable' due to lack of a valid fairness opinion, that decsion would seem to be sufficient to overturn the original IOC BOD approval of the Arrangement itself, due to the fact that the IOC BOD itself ostensibly relied on the faulty fairness opinion. Can IOC get a new fairness opinion and go with the same deal? Can the BOD and CEO be forced out due to corporate malfeasance? Can the IOC shareholders ever catch a break? All Unknown as yet . . .
Lots of questions on how this will turn out. Not very many answers yet.
The whole thing is stunning, despite the obvious facts that shareholders were getting shafted. How often does a shareholder-appoved deal from the likes of a whale like XOM get struck down on anything other than anti-trust grounds?